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Roll

Total

Time

No.

No. of Questions - 7

Allowed - 3 Hours

Total No. of Printed Pages - 12

Maxinruru Marks - 100I

PLE

Answers to questions are to be given only in English except in the case of candidates who

have opted for Hindi Mediutrt. If a canclidate has not opted for Hindi Mecliun, his/her

answers in Hindi will not be valued.

Question No. I is compulsory.

Candidates are required to answer any fir,e questions from the rernaining six questions.

working notes should forrn paft of the respective answer.

Wherever necessary. suitable assumptions should be made and indicated in answer bv the

candidates.

Marks4x5:20

I . (a) M/s Umang Ltd. sold goods through its agent. As per tenns of sales, 5

consideratiott is payable within one rnonth. In the event of delay in

payment, interest is chargeable @ 12% p.a. from the agent. The

company has not realized interest frorn the agent in the past. For the

year ended 3 I " March, 201 5 interest due frorn agent (because of clelay

in payrrent) anrounts to { 1,72,000. The accountant of M/s Umang Ltd.

booked { I ,72,000 as interest income in the year erlded 3 l" March.

20 I 5. Discuss the contention of the accountant with reference to

Accountine Standard-9.

PLE P.T.O.

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(2)

PLE Marks(b) In the books of Mis Prashant Ltcl., closing inventory as on 31.03.2015 5

anrounts to ( 1,63,000 (on the lrasis of FIFo method).The conlpany decides to change from FI FO prethod to weightedaverage nrethod for ascettainin-s the cost of inventory fronr the year2014-15. On the basis of weighted average methocl, closing inventoryas on 31.03 .2015 atnounts to { 1.47,000. Realisable value of theinventory as on 3 I .03 .2015 aurounts to { 1,95,000.Discuss disclosure requirentent of change in accounting policy as perAS-I.

(c) A machinery with a useful life of 6 years was purchased on I't April, 52012 for { 1,50,000. Depreciation was provided on straight line methodfor first three years considering a residual value of lToh of cost.In the beginning of fourth year tlte courpany reassessed the renraininguseful life of the machinery at 4 years and resiclual value was estimatedat 5o/o of original cost.

The accountant recalcr.rlated the revised depreciation historically andcharged the difference to profit and loss account. You are required tocolnment on the treatment by accoutttant and calculate the depreciationto be charged for the fourth year.

(d) Briefly explain the treatnrent of following items as per relevant 5accounting standards :

- The accountant of Star Linrited valued the Goodwill of theconlpany at { 50 lakhs artcl showed the same as Fixed Asset inBalance Sheet. The corresponcling credit was given to Reserves.

- An expellse of { 5 crores was ittcurred on a Machine towards itsRepairs and Maintenance. The accountant wants to capitalize thesame considering the si_enificance of amount spent.

- A plant was ready for comntercial production on 01.04.2014 butcould commence actual production only on 01.06.2014. Thecompany incurred { 50 lakhs as administrative expenditure duringthe period of which 20% was allocable to the plant. Theaccountant added { l0 lakhs to cost of plant.

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(3)

'l", -' " PLE Nlarks

2. The Balance Sheet of Mis Clean Ltd. as or1 3 [ " March. 20 I 5 was 16

sunlnrarized as follows :

Liabilities Amount

(Assets Amount

tShare Capital :

Equity Shares of t 50

each fully paid up

9oh Preference Shares of

< l0 each fully paid up

7% Debentures (secured

by plant & machinery)

8% Debentures

Trade Payables

Provision for Tax

60.00.000

40.00.000

23,00,000

I 7.00,000

6,00.,000

75,000

Land & Building

Plant & Machinery

Trade lnvestrnent

I nventories

Trade Receivables

Cash and Bank

Balances

Profit & Loss

Account

75,00,000

22,00.000

16.50,000

9,50,000

r8"00.000

60.000

15.000

-,J

2

1,46,75,000 1,46,75,000

The Board of Directors of the company decided upon the following schetne

of reconstruction duly approved by all concerned parties :

( I ) The equity shareholders agreed to receive in lieu of their present

holding of I .20.000 shares of { 50 each as under :

(a) New fully paid equity shares of ( 10 each equal to 213'd of their

holding.

(b) 9% preference shares of { 8 each to the extent of 25oro of the

above new equity share capital.

(c) { 2,80.000 , l0% debentures of ( 80 each.

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(4)

PLE

(2) The preference shareholclers a-ereed that their { l0 shares s6ould bereduced to T 8 by cancellation of { 2 per share. They also agreecl tosubscribe for two new equity shares of { l0 each for every fivepreference shares held.

(3) The taxation liability of the conrpany is settled at { 66,000 and the sa*eis paid inrnrediately.

(4) one of the trade creditors of the company to who'r the company owesT 1.00'000 decides to forgo 30to,'o of his clairn. He is allotted equity

. shares of t l0 each in full satisfaction of his balance clairn.(5) other trade creditors of t 5'00,000 are given option of either to accept

fully paid 9o/o preference shares of t 8 each for the amount due to the'ror to accept 80% of the amount due to them in cash in full settle'rent oftheir clainr. Trade creditors for { 3,50,000 accepted preference sharesoption and rest of tltenr opted for cash towards full settlement of theirclaim.

(6) Conrpatly's contractual contmitrnents amounting to { 6,50,000 havebeen settled by payin g 4% pe'alty of contract value.

(7) Debenture holders having charge on plant and machinery accepted plantand nrachinery in full settlernent of their dues.

( 8 ) The rate of interest on 8% debentures is increased to l0%. Thedebenture holders surrender their existing debenture of t 50 each arclagreed to accept l0% debenture of t 80 each for every two debe'turesheld by thern.

(9) The land and building to be clepreciated by 5%.(10) The debit balance of profit ancl loss account is to be elinrinated.(l l) ll4'h of trade receivables and l/5'h of inventory to be written ofLPass 'lournal Entries and prepare Balance Sheet after conrpletior of t6ereconstrtrction scheme in the books of M/s Clean Ltd. as per Sc6eclule III totlre Conrpanies Act, 20t3.

N'f arks

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(s)

' *tt N{arks

3. (a) prepare cash flow statenrent of M/s MNT Ltd. for the year endecl 8

31.' March, 2015 with the help of the following information :

( l) Cornpany sold goods for cash only'

(2) Gross profit Ratio was 30% for the year, gross profit amounts to

{ 3.82"500.

(3) Opening inventory was lessei than closing inventory by t 35,000.

(4) Wages paid during the year < 4,92,500'

(5) Office and selling expenses paid during the year { 75,000.

(6) Dividend paid during the year { 30,,000 (including dividend

distribution tax.)

(7) Bank loan repaid during the year { 2,15,000 (included interest

{ 15,000)

(g) Trade payables on 3 l " March, 2014 exceed the balance on

31" March, 2015 bY { 25,000.

(9) Amount paid to trade payables during the year < 4,60'000.

( l0) Tax paid during the year amounts to ( 65,,000 (Provision for

taxation as on 31.03 .2015 { 45,000)'

( I I ) Investments of { 7,00,000 sold during the year at a profit of

< 20,000.

(12) Depreciation on fixed assets amounts to { 85,000.

( 13) plant and machinery purchased on l5th November, 2014 fbr

{ 2,50,000.

( l4) Cash and Cash Equivalents on 3l" March,2014 { 2,00,000.

(15) Cash and Cash Equivalents on 31" March,, 2015 { 6.07,500.

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(6)

PLE N{arks

(b) Mr. Yash and Mr. Harsh are paftners in a finrr. They drawn the 8

following anlourlts from the fimr during the year ended 31.03.2015 :

Date Amount

(<)

f)raw n by

0l .05 .2014 75.000 Mr. Yash

30.06.20 l4 20.000 Mr. Yash

I 4.08 .2014 60.000 Mr. Harsh

31.12.20t4 50.000 Mr. Harsh

04.03.20 I s 75.000 Mr. Harsh

31.03.2015 15.000 Mr. Yaslt

Interest is charged @ l0% p.a. on all drawings. Calculate interest

chargeable fi'orn each paftner by using Average due date systetn.

(Consider l " May as base date)

4. (a) A tracler intends to take a loss of profit policy with indemnity period of 8

6 proptfts. however., he could not clecicle the policy amount. From the

followin-e details, suggest the policy amount :

(

Turnover in last financial year 6.75,000

Standirtg charges in the last financial year 1.,14.750

Net profit earned in last year was l0% of turnover and the same trend

expected in subsequent Year

Increase in tuntover expected 30%.

To achieve aclclitional sales. trader has to incur additional expenditure of

< 42,500.

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(7)

pLE Marks

(b) SALE Limited was incorporated on 0l .08 .2014 to take-over the g

business of a partnership finn w.e.f. 0l .04.2014. The following is the

extract of Profit and Loss Account for the year ended 31.03.2015 :

Particulars Amount

(()

Particulars Amount

(t)

To Salaries

To Rent Rates & Taxes

To Commission on Sales

To Depreciation

To Interest on Debentures

To Director Fees

To Advertisement

To Net Profit for the Year

1,20.000

80.000

2 1.000

2 5.000

3 2.000

12.000

36.(XX)

2"71^000

6,00,000

By Gross Profit 6.00"000

6,00,000

(i) SALE Lirnited initiated an advertising campaign which resulted

increase in monthly average sales by 25% post incorporation.

(ii) The Gross profit ratio post incorporation increased to 30% from

2s%.

You are required to apportion the profit for the year between pre-

incorporation and post-incorporation, also explain how pre-

incorporation profit is treated in the accounts.

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5. and Ms.

of 4:3:2.

(8)

PLE

Khushi were Partners

Balance Sheet of the

Marks

in a finn sharing Profits 16

finn as on 3l-03-2014Ms. Naina. Ms. Radha

and losses in the ratio

was as follows :

LiabilitiesAmount

(()Assets

Amount

(<)

Capital Accounts

Naina

Radha

Khushi

Current Accounts

Naina

Radha

Khushi

Creditors

3',00,000

2,25,000

1,50,000

25,000

12,500

18,750

I ,03 ,J 50

8,35,000

Plant &

Machinery

Stock

Debtors

Bank Balance

4.26.000

r,85,800 I

1,30,500 i

92,700 I

8,35,000

On 1" April 2014, Ms. Naina

account in the books.

retired. On her retirement goodwill is

Ms. Khushi do not wish to ralse

valued at

Goodwill

Ms. Naina drew her balance of current account on 2nd April,, 2014 and it is

agreed to pay balance of her capital account over a period of two years by

half yearly installments with interest at l0o/o per annum'

on 1', Oct. 2014 Ms. Asmita (Daughter of Radha) adrnitted as a partner.

Ms. Raclha sumendered one third of her share of profit and loss in favour of

Asmita and also transferred one third of her capital to Ms. Asrnita. Ms.

Asmita was rnanager in the firm with annual salary of { 16.000' prior to

adn-rission as a Partner.

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(e)

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The other bank transactions during the financial year 2014- 15

were as follows ' (<)

( I ) Payment to creditors 7 ,7 5,000

(2) Received frorn debtors I I ,25.000

I I ,250(3) Expertses paid

(1) Asmita's salary paid 8,000

(5) Partner's Drawing :

50,000

4t.250

I I ,250

Marks

Ms. Radha

Ms. Khushi

Ms. Asmita

(6) First installment with interest paid to Ms. Naina on 1'' Oct.,2014.

(7) Plant & Machinery sold at { 9,000 on 3''d April,20l4 (Cost { 10,00C}

& Book value { 7.000)

(8) Balances as on 31" March. 2015 : Debtors { 1,50,000, Creditors for

purchases { I .2 5"000" Creditors for expenses T I 0.000 and Stock

{ 1.71.250.

(9) Depreciation is to be written off on Plant & Machinery t 30,350.

(10) Seconcl installment with interest paid to Ms. Naina on l'' April.

20r5.

You are l'equirecl to prepare :

(a) Ms. Naina's loan account,

(b) Partners' capital account.

(c) Partners' current account,

(d) Bank Account, and

(e) Balance Sheet as on 31" March. 2015 in the books of the firm.

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( 10)

PLE

of M/s. TT Club are related

Marks

for the year 66. (a) The following information

ended 3I" March, 2015 :

(l)

(2)

(3)

You

(A)

SuUt.tiFtion received during

Pavments for SPorts Material

are required to :

Ascertain the amount

appear in Income &

ofSubscriptionandSportsMaterialthatwill

Expenditure Account for the year ended

the year

during the Year

< 3,75,000

( 2.25.000

31.03.2015 and

(B)AlsoshorvhowtheseiternswouldappearintheBalanceSheetas

on 31.03'2015'

(b) A Li'rited purchaserJ 5000 eqr.rity shares (face varue 100 each) of l0

Allianz Limited for ( 105 each on r" Aprir. 2014. The shares were

cluoted curr dividend. on l5tr' May.20r4, Alrianz Li'rited declared &

paid clividend of 2o/o for year ended 3 r" March, z0l4- on 30'h June,

2014AllianzLimitedissuedbonussharesinratioofl:5'onl r, october, zlr4Ailianz Li'rited issued rights share in the ratio of I : l2

Qt.45 per share. A lirnited subscribed to harf of the rights issue and the

balance was sord at { 5 per right entitrement. The company declared

interirn dividend of 1% on 30'l'Novernber,2{Jr4. Right shares were not

entitred to dividend. The company sold 3000 shares on 31" Decernber,

z0r4 at 95 per share. The company A Ltd. incurred 2o/o as brokerage

while buYing and selling shares'

YouarerequiredtopreparelnvestmentAccountinbooksofALtd.

9

As on

01-04-2014 (<)

As on

31-3-201s (o

Atnount due for SPorts Material

SubscriPtion due

SubscriPtion received in advance<

Balances

St".k "f SPorts Material 75,000

67,500

I 1,250

9,000

1,12,500

97,500

16,500

5,2 50

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7.

(l l)

PLE

Attempt any four out of the following :

(a) Prepare the General led.-eer adjustment account in creditor's ledger

the year ending 3 I " March, 2015 frorn the following information :

Sundry creditors as on 01.04.2014 T 2.30,000.

Marks

4x4:16

for 4

P.T.O.

-g)=:s; ""

Total purchases arnounted to T 8'25,000 including purchase of trade

investtnent for { 45,000 (face value ( 50,000). The total cash purchases

were 60% lnore than the credit purchases.

Cash paid to creditors during the year was 50o,/o of the aggregate of the

opening creditors and credit purchases for the period. Creditors allowed

a cash discount of ( 8,000.

A Cheque paid to creditors t 7,000 was dishonored.

Goods returned to suppliers t I 1,000.

Bills receivables amounting to t 30,000 endorsed in favour of a creditor

in the month of February.20l5.

(b) Describe the conditions to be satisfied for Amalgamation in the nature

of rnerger as per AS- 14.

(c) Anand purchased goods from Aniir-tha, the average due date for

payment in cash is 10.08.2015 and the total amount due is t 67.500.

How much amount should be paid by Anand to Amirtha, if total

payment is made on following dates and interest is to be considered at

the rate of 12o/o p.a.

(i) On average due date.

(ii) On 25'h August, 2015.

(iii) On 30'h July, 2015.

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PLE l\{arks

(d) A company sold 20% of the goods on cash basis and the balance on 4

creditbasis.Debtorsareallowedl%rrronth'screditandtheirbalanceasl

on31.03.2015is(l'25'000.Assumethatthesaleisunifbrrrrtlrr.ough

out the year. Calculate the creclit sales and total sales of the company

for the year ended 31.03'2015.

(e) What are the disadvantages of using an Enterprise Resource Planning 4

package ?

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